Palm Beach Mayoral Candidate Has Corrupt Past In Bahamas

Even by Florida's loose ethical standards, Palm Beach mayoral contender C. Gerald Goldsmith has a corrupt past that should make his candidacy a joke.

Goldsmith, who served on the Palm Beach town council back in the mid-1990s, survived the Feb. 3 election and is now in a runoff with incumbent Jack McDonald. The showdown vote comes next Tuesday, February 17. 

Goldsmith, who is now chairman of the First Bank of the Palm Beaches, recently backed off a debate with McDonald -- and it turns out that he has a whole lot to hide.  

Gerry Goldsmith is linked to rampant fraud and political graft in the Bahamas, dating back more than three decades.

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Goldsmith In His Dubious Heyday
For starters, he was charged by the Securities and Exchange Commission in 1978 with diverting $3 million for personal use from a company he was running in Freeport.

The company, Intercontinental Diversity Corp., was involved in fraud involving the Port Authority and a gambling concern in Freeport. According to a 1978 article in the New York Times, penned, incidentally, by a young freelancer named Judith Miller:

"The [SEC] complaint ... accused Mr. Goldsmith and the company, which operates the Port Authority, airport, utilities, and a gambling casino in Freeport, the Bahamas, with violating the anti-fraud, reporting, and proxy provisions of the securities laws.

Specifically, the commission alleges that Intercontinental Diversified's books and records were falsified, that fictitious records were created, United States Customs reporting requirements were possibly violated, and materially false and misleading information was presented in SEC required reporting forms."  

Goldsmith, now 80, agreed to return $2.9 million to the company and promised, in effect, to stop violating the law --  a weak punishment that provides further proof that the SEC has historically been an extremely ineffective agency. Scroll down this document to see the SEC report.  

But that's just the tip of the iceberg. In his 1998 book titled Masters of Paradise: Organized Crime and the Internal Revenue Service in the Bahamas, author Alan A. Block details a complicated web of corruption involving Goldsmith in the Bahamas. Block writes that Goldsmith, a "well-heeled political corrupter," siphoned money from Intercontinental Diversified for political payoffs. "Goldsmith diverted $4,431,600 for political payoffs in The Bahamas with perhaps a little falling into his own pocket," writes Block, a professor at Penn State University.

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Lee Hershfield -- Palm Beach Daily News
Goldsmith (right) On The Campaign Trail
Block alleges that when the SEC had finished its investigation of Goldsmith and his company, there was still $1.4 million unaccounted for. Block writes, "Where else could it have gone, investigators wondered, but into some secret Goldsmith account ...".

Don't kid yourself, this is some sordid stuff, also involving the Teamsters and Cosmos Bank. It's complicated, so if you want to really delve into it, Block's book can be read online here.

A call for comment this morning to Goldsmith's campaign office hasn't been returned to the Pulp.

Though details of Goldsmith's shady past can be easily found online, it's never been reported by either the Palm Beach Daily News or the Palm Beach Post. I'm told that the Shiny Sheet is fully aware of Goldsmith's history but refuses to publish it (which would seem to add credence to those who say the newspaper is largely useless, or worse). 

Maybe the wealthy island's political elite don't like to talk about such sleazy things, but the voters should know who they're really voting for, or against, as it may be.

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